Palantir CEO Investing in NEW Military Tech [Buy THIS Stock?]
Overall Thesis
Palantir CEO's investment in a new Ukrainian defense technology fund focused on drone and missile development presents a bullish opportunity for defense contractors like Kratos that specialize in drone and interceptor technology.
Narratives
Boeing is mentioned only as a customer of Kratos's Spartan jet engines used in JDAM long-range munitions production, without any commentary on Boeing's stock outlook.
Key Arguments
- Kratos is providing Spartan J85 turbojet engines to support Boeing's JDAM production contract
L3Harris is mentioned only in passing regarding reluctance to license drone/missile technology to Ukraine due to IP theft concerns, with no stock-specific commentary.
Key Arguments
- L3Harris reportedly unwilling to license weapons technology to Ukraine over IP theft concerns
Kevin views Kratos as a fast-growing but currently overvalued defense player, with major upside from drone interceptor technology, jet engines (Spartan), hypersonics, and the recent Orbit Technologies satcom acquisition. However, he flags that the stock is trading at rich 'software multiples' relative to thin net margins, and a valuation tool he uses shows a negative forecast return, though he'd consider it attractive again near $24.
Key Arguments
- Kratos is developing directed-energy and interceptor technology to counter fast jet-powered attack drones like the Geran-4
- Spartan turbojet engine business is one of the company's largest opportunities, with thousands of units planned including for Boeing's JDAM program
- Hypersonics business is expected to double in 2026 and again the following year
- Recent acquisition of Israeli satcom company Orbit Technologies adds to UAV/missile communications capabilities
- CEO commentary hints at a major but undisclosed ramp in drone-related deliveries
Predictions (1)
The video centers on reports that Palantir CEO Alex Karp is personally investing in a new Ukrainian-founded defense venture fund focused on drone and interceptor technology. Kevin frames this as evidence of Palantir's broader positioning across multiple sides of ongoing conflicts, but does not offer a specific price or stock-level thesis on PLTR itself.
Key Arguments
- Karp reportedly the first major investor in a new defense fund started by Ukraine's former defense minister
- Palantir markets its AI systems as critical to conflicts involving Russia/Ukraine and Iran/Israel
- Karp's private investment activity suggests continued deep involvement in the defense/AI sector
Raytheon is referenced briefly as a maker of the Patriot missile interceptor and the Phaser high-powered microwave counter-drone system, used as context for the broader defense technology discussion rather than a stock thesis.
Key Arguments
- Raytheon produces the Phaser directed-energy/microwave system for countering drone swarms
- Patriot interceptors cited as costing around $3 million each versus far cheaper directed-energy alternatives
Hedges & Caveats
- Geopolitical risks and war-related uncertainties
- Regulatory and IP concerns with international defense manufacturing
- Legacy defense contractors may resist new competition
- Emerging technology adoption timelines are uncertain
- International defense contracts subject to government approval